Why are you supporting the compromise legislation as an alternative to the November ballot issue?
If you look at the ballot question, on the penalty side if a manufacturer cannot or will not comply with law, then the ballot question would prevent that manufacturer from being able to sell product in Massachusetts. But as you know, manufacturers don’t sell the product; it's the dealers. The penalty would fall heavily on the dealers.
Secondly, there are a number of types of vehicles that would be included in the ballot question that probably have no way of complying with J2534 standard — heavy duty trucks, buses, RVs, motorcycles. They are all included in the scope of the ballot question, yet it would be very difficult for them to comply by model year 2015, as called for.
This issue has been polling rather well, so I would say that as we sit here now, it's probably even money it will pass. It's not a very good document for us.
What has changed in the bill before the legislature that makes it a better alternative?
They've removed the penalty that the vehicles can't be sold, and removed heavy duty trucks. We got language in there that would protect dealers from having to deal with a situation where they may be forced to purchase multiple products from the manufacturers at a higher rate.
We also got language in there that would reaffirm dealers’ rights to warranty recall work. In the ballot question, there is language calling for authorized repair facilities designated by manufacturers. We got the Senate to take that out, because it was our feeling that the manufacturers would be able to use that language to set up repair facilities outside of the scope of the dealer network.
The issue has continued to gain momentum in Massachusetts. What's driving this? Do you think there's a misperception about the availability of repair information?
Understand that dealers are independent repairers as well. We cannot survive in the marketplace if we're just working on vehicles for the linemaker. The dealers make the investment and buy what they need to buy to be able to diagnose and repair vehicles outside their [nameplate]. It's really the only way they've been surviving. We have about 25 percent of the market share on after-warranty repair work, and dealers have made a lot of investment to get that.
All of the information is out there, all the tooling you need is out there. It's just a matter of how much investment you want to make in the business to do what you have to do. We don't carry water for the manufacturers on this. Yes, we're dealers for the franchisor, but we're also independent repairers, and as independent repairers we can tell you that this stuff is out there.
When the manufacturers indicated they were interested in cutting a deal, and the legislature was looking at an alternative bill, that's when we stepped up our efforts to get changes to the document that would protect dealers.
It's important for people to realize that we wouldn't be in this situation if the ballot initiative process didn't exit. What has occurred in Massachusetts over time is that proponents of an issue will try to create a worst-case scenario of a bill through a ballot initiative and get the parties to come to the table in the legislature to get something in between. We're not looking enthusiastically at this bill, but if there is going to be this ballot question, and it looks like it's going to pass, and it's bad for dealers, we'd be fools to sit on the sidelines and watch this play out without participating.
